Ray Dalio: Investors should worry about the value of their money as much as the value of their investments

Seeking Alpha/Michael Fitzsimmons

photo of large pile of historic, European gold coins

“The basic thesis of the interview is that America has not been a good steward of the benefits of capitalism, which has increasingly gone to fewer and fewer people even as the U.S. has created a mountain of debt. That leads to a loss of productivity and reduced opportunity for the country’s citizens. And, as Dalio puts it, ‘Wealth cannot be created by creating debt and money.’ The result, Dalio believes, is that the world is likely to change in ‘shocking ways’ over the next five years, including a loss of faith in the U.S. dollar: ‘Within the next five years you could see a situation in which foreigners who have been lending money to the United States won’t want to.'”

USAGOLD note:  Contrast Dalio’s thinking with that of the economists and theorists quoted at the link in the post directly below …… It is because so many in government agree with the analysts quoted below that gold remains a crucial component of the well-balanced investment portfolio. “Assuming a well-diversified portfolio (which does include cash for emergencies),” writes Fitzsimmons at the link above, “my belief is that middle-class investors (net worth under $1 million), should own at least 5-10% in gold. I also believe that as an American investor’s net worth climbs, the higher that percentage should be because, in my opinion, he or she simply has more to lose by a falling US$. For instance, an investor with a net worth of $2-5 million might have a 15-20% exposure to gold; $10 million, perhaps a 30-40% exposure.

Repost from 9-23-2020

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